Railways' freight traffic declining on non-competitive tariff: Economic Survey

New Delhi: The share of Indian Railways in freight movement has been witnessing a drop over a period of time, mainly on account of non-competitive tariff structure, Economic Survey said on Monday.

While the passenger fare had remained more or less flat, the freight fare has gone up sharply over the years, it said.

"The share of Indian Railways in freight movement has been declining over a period of time primarily due to non- competitive tariff structure," Economic Survey 2017-18 tabled in Parliament said.

In a bid to make rail transportation attractive and arrest the declining trend of rail share, the survey said, various initiatives were taken in FY2017 which includes tariff rationalisation, new policy guideline for station to station rates, withdrawal of dual freight policy for export of iron ore and rationalisation of coal tariff.

During the current fiscal (up to September last year) Indian Railways carried 558.10 million tonnes (MT) of revenue earning freight traffic as against 531.23 MT during FY2017 (up to September 2016), showing an increase of 5.06 per cent during this period, it said.

Facing stiff competition from other modes of transportation, the government is introducing various transformative measures in order to keep railways on track.

"These measures are focusing on prioritising investments in important areas, viz dedicated freight corridors, high speed rail, high capacity rolling stock, last mile rail linkages, port connectivity, and attracting private and foreign direct investment," the survey said.

Station redevelopment is the biggest non-fare revenue generating project for redeveloping railways stations in the country and has been included in the Harmonised List of Infrastructure Sub-sectors.

Station redevelopment programme is envisaged to be done by leveraging commercial development of railways' spareable space in and around the station.

The Survey further said that the rapid urbanisation has created increased demand of civic facilities and transport infrastructure.

Higher capacity rail based mass transit system popularly called Metro, are rapidly being accepted across the nation as a solution to the problem of urban transportation. Following the success of the Delhi Metro, many cities have implemented or are planning for metro rail systems.

The Centre has been providing financial assistance to cities for improving public transport, including metro rail projects.

"There are 425 km of metro rail systems operational in the cities of Delhi, Noida, Gurugram, Kolkata, Mumbai, Chennai, Bengaluru, Hyderabad, Jaipur, Lucknow and Kochi and another about 684 km are under construction in various cities by December 2017," the survey said.

As metro rail projects are highly capital intensive, it is difficult to fund metro rail projects from government exchequer only.